Western Price Survey / Archives
October 3, 2003
Despite a handful of outages of large-capacity generators in the Western region this week, it was a bit of a struggle during the early part of the week for prices to keep pace with last week's figures. The ramping down of Palo Verde nuclear unit No. 2 for refueling and other maintenance took about 1,200 MW off line this week, while Four Corners Unit No. 4, with 750 MW of capacity, continues to be on an unplanned hiatus. That unit, as well as the 750 MW unit No. 5 were both off line the better part of last week, but No. 5 returned to operation over the weekend. This gain in capacity was offset by the loss of Mohave Generating Station's 790 MW No. 2 unit on Tuesday morning.
The outage of Palo Verde No. 2 will last about two and a half months, according to Arizona Public Service spokesperson Sheri Foote. In addition to the refueling, technicians will replace two steam generators and three low-pressure turbine rotors in the unit, Foote said. The improved efficiency due to the maintenance and new equipment will allow for a 90 MW uptick in the capacity rating of the unit
The price of power puttered along in the same vicinity as it had last week, even dropping a mill or two at most Western hubs over the week. The price spread for California/Oregon Border power remained fairly anemic in each day of trading; peak power moved for between 42 mills and 44.25 mills/KWh at the hub on Monday and Tuesday before dipping to a low of 39.75 mills/KWh on Thursday.
High-demand SP15 prices have been a bit more robust-- peak-load power at that hub haved ranged from 44.75 mills to 54.25 mills/KWh for much of the week. Off- peak prices at SP15 reached as high at 39.75 mills/KWh on Monday before dropping down to between 31.50 mills and 35.75 mills/KWh by the end of the week.
A glance at the weather report in the California Independent System Operator's territory would not have set any trader's heart racing during the early part of the week. What looked at first like a fairly warm week throughout the state rapidly devolved to temperatures in the seasonal to subseasonal zone. Cal-ISO projected about 34,371 MW of load on Monday but wound up with 33,947 MW. Friday's peak demand was projected to be about 31,295 MW, but that estimate was cut back to 30,920 MW on Friday morning.
The most recent figures for Northwest precipitation show continued dryness in the region, though last April's deluge throughout the West did much to contribute to reservoir levels. The US Army Corps of Engineers reported cumulative precipitation in the Columbia River Basin above Grand Coulee Dam to be about 79 percent of normal; the Snake River Basin is at 91 percent; the Columbia Basin above the Dalles is at 85 percent and the Willamette River Basin is at 89 percent of normal.
The California Department of Water Resources snapshot of water conditions in the state report that reservoir-storage levels are up 15 percent from last year's levels. Overall, said DWR, water storage is at two-thirds capacity. Cumulative precipitation in California in the last year is running at 110 percent of average, compared to 80 percent a year ago [Shauna O'Donnell].
Winter Gas Relief Levels Prices
This week's gas-storage numbers released by the Department of Energy's Energy Information Administration put a distinct damper on prices at the end of the week. While levels of gas in storage for the fast-approaching winter bodes well for consumers, it did little for traders on Thursday and Friday.
National storage figures have reached levels just 2 percent under the five-year average after a healthy 100 Bcf injection for the week ending September 26. With that news, prices pooped out at Western hubs at the end of the week.
After opening the week at a low of $3.93/MMBtu, San Juan gas rallied in Wednesday trading, reaching a high of $4.46/MMBtu. However, with the anticipation of large storage figures coming from the EIA, the price of gas at the hub slipped to between $4.075 and $4.27/MMBtu in Thursday trading. The bottom fell out on Friday, as San Juan gas moved for as little as $3.975/MMBtu.
Other hubs reported similar behavior--prices opened the week in the unremarkable range between $4.00 and $4.50/MMBtu, perked up mid week, then fell off swiftly Friday [S O'D.].
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